Twenty-year Government incentives promoting carbon capture use and storage (CCUS) will reportedly headline benefits to the energy sector in Jeremy Hunt’s Budget on Wednesday.
The Treasury confirmed late last week that CCUS will reap the rewards of Hunt’s pledge to have ventures ready for construction by the end of 2024, ideally within the first of several low-carbon industrial clusters. Ministers including energy secretary Grant Shapps want the feasibility of smaller, dispersed CCUS hubs also to be explored.
Officials briefed journalists that investment pumps are being primed for capacity able to seize and bury up to 30 million tonnes of CO2 annually by the end of this decade.
That figure’s in line with demands from the independent Committee on Climate Change, but runs at double the capacity for CCUS achieved so far in Britain. Even these lower levels will not be met, the climate scientists have warned, without the government doubling current rates of deployment.
Recent governments have form for blowing hot, then quickly cold over CCUS’ potential. Most notorious is chancellor George Osborne’s withdrawal in autumn 2015 of an existing £1 billion competition fostering practical CCUS installation. No subsequent Whitehall promotion for the technology has reached those heights.
And doubts persist among the Opposition and energy observers as to whether CCUS will bring about enough radical change. Critics fear that CCUS clustering could still lead some industries to “cherry-pick”, applying the technology to industrial sectors more easily amenable to decarbonisation – such as heat and mobility – , while leaving output of industrial materials such as steel largely untouched.
The relative immaturity of pre-commercialisation CCUS technologies also raises questions on the advisability of Whitehall investing such political and financial capital in them.
Nuclear, and in particular small reactors adapted from submarine propulsion, retain a lot of backers in Whitehall. Treasury officials confirmed last week that Hunt and Shapps will sponsor a new competition seeking to speed SMR reactor development, supported by an undisclosed prize money provided by the government.
If the Energy Security Strategy’s goal is met of 24 GW of nuclear capacity by mid-century, then the technology will be providing 21% of the nation’s power, up from 16 in 2021. Small generating units are essential to that goal, given the decade-long lead times and multi-billion cost over-runs of giant plants like Hinkley Point C.